How to negotiate on a land sale
Negotiating with a land seller is an important part of the process involved with purchasing a piece of property. The buyer often seeks certain concessions or counters with a lower price after the property seller quotes a figure. Negotiations should always take place to purchase land at a good price. In order to make various land sales go as smoothly as possible, there are several things that people should remember during the negotiation process.
Always Start with a Property Review
The asking price for real estate may not often be the agreed-upon buying price. People generally try to negotiate a lower price after a review of the current title on the real estate that is for sale. In reviewing real estate, people should always look at the vesting deed and the appraisal from the county clerk’s office.
Property interests are typically conveyed by a deed. In a number of cases, people transfer or sell partial interests on their real estate. Due to this, it is vital to thoroughly assess the deed in order to determine if there are any sort of rights or easements that have been granted for the property’s use without the need to own the property.
Either the buyer or seller or both may ask for an appraisal. At the same time, they should ask an appraiser for a similar property analysis. In that way, people can see similar real estate that is sold in the area. At the same time, it allows them to compare prices in order to determine if the property’s asking price is reasonable.
Let the Other Group Speak First
There are two reasons why people should let the other party speak first when negotiating land sales. It allows them to define a clear mid-point. By allowing the other party to state their position first, people are given the ability to determine the negotiation’s mid-point. In addition, people give away important information to the other group by stating their position first. They will utilize that data to get the most they can in the deal.
Always Obtain a Copy of Restrictions and Covenants
Ideally, people should employ a real estate attorney and a realtor who knows the restrictive covenants in the area and what they can and cannot build on a piece of real estate. In short, it is important for people to know how the real estate is zoned. This allows buyers to negotiate on the real estate’s price if there are any restrictions.
Start Listening and Stop Talking
One of the strongest maneuvers that a person can use when negotiating a property is to keep their mouth shut. Unfortunately, it is also a hard things to do. This is because people are usually uncomfortable during silence in negotiations.
However, it is important to make sure those silent periods happen during land deals. If they are uncomfortable, so is the person that they are negotiating with. A common result of this very uncomfortable situation is that one group will accept a concession in order to break the awkward silence.
Information Is Power
Land sales experts estimate that the party with the most information regarding the property will walk away with a much better outcome in 95 percent of all negotiations. When negotiating a land sale, it is important for a person to have as much knowledge as possible about the real estate, the object of the negotiation, the party that they are negotiating with and their motives.
This is because most individuals tend to assume that a land negotiation is often about money. However, it frequently is not. A smart negotiator will realize that it is more important to solve a dilemma than to offer the other party more money than other buyers.
Always Implement a Penalty if Concessions Are Being Asked
If people want to discourage the other party from asking for any sort of concessions in their negotiations, they should enforce a penalty every time that they ask. The penalty does not need to be the same for every offense. However, it is important for people to not let the other party know that they are doing this because it is quite possible that they will decide that it is not worth the time and effort.
Always Obtain the Last Concession
A good negotiator has the capability to convince the other party to do what they want without them even knowing it. However, there is another way of doing this that involves always making sure to obtain the last concession on the negotiating table.
By obtaining the final concession, the other group will put a hold on asking for things once they have what they need or want from the negotiation. The other party will realize that they will be required to make concessions every time they ask for something. Because of this, they will naturally avoid asking for more than what they need in fear that they will be asked to give up something that is very important to them.
More to Read: